The TEGOS team provided legal assistance to AS “Latvenergo” in a complex legal proceeding related to the right of a natural gas trader to unilaterally terminate a natural gas trading contract.
Based on the arguments of AS “Latvenergo” representatives, the Senate referred to the previously established case law that a “connection point” in the natural gas system cannot be legally qualified as a “gasified facility” separately.
Since one of the mandatory prerequisites for a user to be entitled to receive natural gas from a trader in a gasified facility in accordance with a concluded natural gas trading contract is the ownership, use or possession rights of this person to the relevant gasified facility, then the user’s use rights only to the natural gas “connection point” are not sufficient to allow the trading of natural gas for the benefit of this user, and the trader is entitled to unilaterally terminate the natural gas trading contract. In the opinion of the Senate, the trader has such rights also if the user has not had ownership, use or possession rights to a gasified facility since the start of trading, but the circumstance has become known or clarified only later for some reason.
TEGOS expert team and contribution
TEGOS team supported AS “Latvenergo” throughout all stages of the proceedings, preparing legal arguments and defending the client’s rights and interests.
The work of the team was led by TEGOS Partner and Head of Energy practice group, Agnese Hartpenga, assisted by Of Counsel Gundars Madelis and Senior Associate Elīza Siliņa.
This case particularly highlights the importance of thoroughly assessing both the substance of contractual relations and the actual use of resources to ensure legal certainty and protect commercial interests in the energy sector.
